Cost pool

Cost and management accounting.

A cost pool is a more refined development of a cost centre, used in activity-based costing.

Cost pools are defined by activities such as design, set up costs, quality control, material ordering and production monitoring.

Costs established in the cost pools are then allocated to units of production on the basis of activities consumed.

See also

• Absorption costing
• Activity-based costing
• Cost centre
• Cost saving centre
• Hedging
• Management accounting
• Profit centre
• Response to risk